The trial of the CEO of cryptocurrency exchange FTX begins, and a long prison sentence looms

The trial of the CEO of cryptocurrency exchange FTX begins, and a long prison sentence looms

Photo: Afghan National Police

The founder of bankrupt cryptocurrency exchange FTX, Sam Bankman Fried, who is suspected of fraud, faces the risk of spending years in prison. The criminal trial against him begins on Tuesday, and a New York judge overseeing the case warned last week that the 31-year-old cryptocurrency entrepreneur faces a “very long sentence” if convicted. FTX’s downfall involved billions of dollars.

Bankman-Fried is seen as the mastermind behind the FTX scam. This fraud occurred by directing clients’ money to the Alameda Investment Fund, of which he is also the founder and which he used to make risky investments. Since customers could not access their funds, FTX went bankrupt. Technically, Bankman-Fried faces up to 110 years in prison, although it’s not clear the sentence will be that severe.

The suspect was arrested in the Bahamas last year. He was later placed under house arrest at his parents’ home in Palo Alto, California. That changed in August when his bail was revoked and he was handcuffed again. Bankman-Fried allegedly leaked documents in an attempt to discredit an important witness in the case against him.

The former FTX CEO has so far always denied that he is guilty of the fraud scandal. But the former business partners pleaded guilty and subsequently cooperated with the US investigation.

It is expected that the jury that will sentence Bankman-Fried will be selected only on Tuesday. The substantive hearing in the case is scheduled to begin on Wednesday. This condition is likely to last about six weeks.

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There are more charges pending against Bankman-Fried. He is also said to have tried to influence politicians with donations. These politicians then had to arrange legislation favorable to FTX. But Bankman-Fried allegedly did not adhere to the rules on political donations. Moreover, the victims went to court to demand the recovery of a lot of money.

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